Top stock picks by Motilal Oswal: Large, mid & small cap recommendations

Motilal Oswal reserach desk have suggested buying M&M, Bharti Airtel, PNB and others today; here's why

Stock picks by Motilal Oswal 

Large Cap

M&M – Target: ₹3,482

M&M reported a better-than-expected performance in Q4, led by a strong margin beat in FES segment (at 19.4 per cent against 17.3 per cent estimate). Revenue grew 24.5 per cent year-on-year (Y-o-Y), and Earnings before interset, tax, depreciation and amortisation (Ebitda) margin expanded 180 basis points (bp) Y-o-Y to 14.9 per cent, driven by improved ASPs across both the Auto and FES segments. 

 

Management remains confident of outperforming the UV industry in FY26, driven by new launches like Thar Roxx, XUV 3XO, and recent EVs. It plans to boost UV capacity to 69,000/85,000 units in FY26/FY27, with a greenfield project for future requirements beyond FY28. We believe M&M is well-placed to outperform across its core business, driven by a healthy recovery in rural areas and new product launches across both UV and tractor segments. We estimate M&M to post compound annual growth rate (CAGR) of 13 per cent/13 per cent/18 per cent in revenue/Ebitda/PAT over FY25–27E.  FOLLOW STOCK MARKET LIVE UPDATES TODAY

 

Bharti Airtel – Target: ₹2,110

Bharti's Q4FY25 performance was in-line. India wireless revenue/Ebitda grew 1 per cent/2 per cent quarter-on-quarter (Q-o-Q), offset by fewer days. Consolidated net debt inched up by ₹5,000 crore due to the redemption of $1 billion perpetual bonds. 

 

We continue to favour BHARTI's superior execution on premiumisation. Robust free cash flow (FCF) of ₹9,700 crore/₹39,000 in Q4/FY25, along with moderating capex, should lead to significant FCF generation of ₹1 trillion in FY26-27E. We model a 14 per cent/17 per cent CAGR in Bharti's consolidated revenue/Ebitda (FY25-28E) driven by an expected 15 per cent India wireless tariff hike (December 2025), faster home broadband growth, and continued strong double-digit growth in Africa.

 

Mid Cap

Punjab National Bank – Target: ₹125

PNB reported a Q4FY25 PAT of ₹4,570 crore (+52 per cent Y-o-Y), in line with estimates, supported by better other income and a lower tax rate. However, NII missed due to a 12 basis points (bp) Q-o-Q decline in net interest margins (NIMs) to 2.81 per cent. Loan growth was healthy Y-o-Y at 15.3 per cent, though modest Q-o-Q; deposits rose 14.4 per cent Y-o-Y. Slippages surged 69 per cent Q-o-Q, mainly from MSME and agri loans, yet gross net performing asset/net non-performing asset (GNPA/ NNPA) ratios improved to 3.95 per cent/0.4 per cent. Management expects stable net interest margins (NIMs) (2.8–3 per cent) and credit growth of 11–12 per cent. With FY27E RoA/RoE at 1.05 per cent/15.5 per cent, improving asset quality, and strong recovery prospects, we reiterate 'Buy'. 

Radico Khaitan – Target: ₹3,000

Radico Khaitan, a legacy player since 1943, is one of the oldest and largest IMFL manufacturers in India with a diverse portfolio across whisky, vodka, gin, rum, and brandy (ranging from ₹500 to ₹8,000), covering a large customer base. Driven by consistent volume growth (from 20 million cases in FY15 to 31m in FY25)  and sharp execution, Radico has outperformed peers through premiumisation and is now expanding its premium and luxury portfolio to strengthen trade and consumer pull. With an 8 per cent IMFL market share and rising presence in the P&A segment, we estimate a robust 6 per cent/22 per cent/30 per cent in revenue/Ebitda/adjusted PAT CAGR during FY25-28E. Overall volume is projected at 9 per cent, driven by a robust 15 per cent CAGR in the P&A portfolio.

 

Small Cap

Niva Bupa – Target: ₹100

Niva Bupa reported 18 per cent/25 per cent Y-o-Y growth in Gross Written Premium/Net Earned Premium in Q4, driven by 3 per cent/59 per cent/18 per cent growth in retail health /group health/PA businesses. It secured business from two large corp. accounts, significantly contributing to strong growth in group health. With a Y-o-Y expansion of 50bp/190bp in commission/expense ratios, the combined ratio improved to better-than-expected 92.8 per cent, up 340 bp Y-o-Y. 

 

Measures taken to mitigate claim inflation will continue to aid loss ratios, while op. efficiency will lead to improved expense ratio going forward. We believe Niva is well-positioned to harness growth opportunities with a strategic global partner, a growing customer base, and innovative product offerings. The diversified channel mix will ensure improved scalability as the company moves toward geographic expansion.

Marico – Target: ₹800

Marico (MRCO) reported Q4FY25 revenue growth of 20 per cent Y-o-Y, with domestic revenue up 23 per cent driven by strong core category performance and new growth drivers. International revenue grew 11 per cent. Ad spends rose 35 per cent, leading to a 260 bp Y-o-Y contraction in Ebitda margin to 16.8 per cent, while Ebitda grew 4 per cent against 7 per cent estimate. 

 

Revenue growth is expected to remain in double digits in FY26, driven by pricing, expanded reach, and strong performance in Foods and Premium Personal Care. Despite rising input costs, margin outlook for H2FY26 is positive. We forecast 11 per cent/13 per cent revenue and Ebitda CAGR over FY25-27, reiterating a 'Buy'.  (Disclaimer: This article is by Motilal Oswal Financial Services Research desk. Views expressed are its own.)